Strategies for managing volatility
It’s an age-old cycle in the mining industry: strong commodity demand pushes up prices which, in turn, impels companies to ramp up production. As long as demand remains high, the cycle continues. When demand drops, however, prices plummet, supplies build up and marginal projects become considerable less attractive.
It’s no wonder, then, that the mining sector is buoyed by evidence of a tentative financial recory. So here’s the burning question: is it sufficient to overcome the structural weaknesses in today’s commodity markets.
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